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MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
Professor
Phoniex University
Oct-2001 - Nov-2016
On July 1, 2014 Salem Corporation issued $3 million of 12% bonds payable in 10 years. Each bond is $10,000. The bonds pay interest semiannually. The bonds include detachable warrants giving the bondholder the right to purchase for $30, one share of $1 par value common stock at any time during the next 10 years. The company sold the bonds for $3 million. The value of the warrants at the time of issuance was $200,000.
1. Prepare journal to record the issuance of the bonds.</pclass="msolistparagraph">
1. 2. Prepare a journal entry if half of the warrants are exercised.
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